Coming into July, we were riding the Natural Gas high like we had a straight shot to the moon, especially off big shale announcements like Chesapeake (CHK)’s Haynesville Shale venture. Sure, nothing goes vertical forever and we all knew natural gas would have to “correct” for a while. However, for us at-home mom-and-pop non-commodities traders, a lot of the time it felt like we’re just riding this straight shot to the moon blind.

Thankfully, veteran commodity trader Joe Terranova on CNBC’s Fast Money had a simple rule of thumb to offer: June Highs, July Lows. Does it always work? Of course not! Market’s aren’t that easy! But I did a little check and found this rule of thumb is a good one any of us with natural gas exposure to keep close to heart. I used charts from the Federal Energy Regulatory Commission’s Natural Gas Market info- one of my favorite research tools I’ve collected at my SuckingLess.com website.

As you can see, other than the out-of-norm Katrina event in 2005, July natural gas prices have generally been lower than June prices. This weakness seems to persist from July into early or mid august. While natural gas prices in the following December-Januarys are usually higher than the July-August weakness, there are a few years where Natural Gas prices just keep sliding the rest of the year. I suppose Natural Gas prices still depend on the weather and how much of it is used, so it still has that random factor that we should all be aware of.  Personally, I think selling some Natural gas, whether taking partial or full positions off, seems like a smart thing to do given historical trends suggest July will be lower than June. Sure, you might miss another “Katrina” spike, but that feels more like rolling the dice.  Because I didn’t want to be completely out natural gas in case we get the hurricane spike, I’ve kept 25% of my HAL position, but bought USO puts against it.

However, this year, Natural Gas prices have been on a steady climb alongside crude oil’s climb, natural gas looking much less volatile than in the past. Natural gas isn’t a direct replacement of crude oil, but there are various users of energy who can switch between the two. When crude oil gets too expensive, they would switch to natural gas, thus increasing natural gas’s demand and raising it’s prices alongside crude. Jim Cramer offers a separate rule of thumb: Natural Gas prices trade at roughly 1/6 the price of crude oil. So, at the moment, either crude oil is too expensive or natural gas is too cheap

Also, I have offered the analysis of the trend to use much more natural gas for electrical power generation by utilities around the world. This should decrease some of the volatility in natural gas prices as demand becomes more consistent to produce consistent electrical power. Still, we need to do something about our limited storage capacities!

Remember, beyond just owning the companies, dig just slightly deeper into the businesses the companies are in. That’s why I started SuckingLess.com, to collect the most relevant industry magazines and information useful to investors.

SuckinLess.com Research Resources Used:

• FERC Natural Gas Markets: U.S. Government Data, Analysis, and Reports
• Platts: Professional Energy and Metals Information (Prices, Data, Maps, Events, Magazines, Reports)
• Power Engineering Magazine: Power Generation Industry Magazine

**Disclosure: I am long of CHK, HAL, and USO puts as of this post**

To kickoff the launch of SuckingLess.com, I’m going to feature some of the best submitted resources SuckingLess.com users are recommending. We kick off earnings season today with Alcoa (AA) earnings, so EarningsWhisper might be the most useful site overall for the next few weeks to stay on top of the barrage of earnings to come. If you don’t know already, “whisper numbers” are the more up-to-date earnings expectations instead of the out-of-date analyst expectations you find on a Yahoo Finance. Companies and their businesses are constantly changing, and Wall Street analysts and fund managers are constantly in-touch with these companies. However, the updated expectations only exist on email correspondence between the companies, fund managers, and analysts and don’t make it into the public. So, when a company reports earnings “Better than expected” and falls or “worse than expected” and goes up, it is because those “expectations” were out of date. Rather, the company’s earnings and the stock’s move was probably more related to the “Whisper number”. Check out my listing of EarningsWhisper at SuckingLess.com to learn more.

**Disclosure: EarningsWhisper is an affiliate of SuckingLess.com**

If investors have “reserves” (pun intended) about the amount of oil and gas in the Haynesville Shale, Chesapeake CEO Aubrey McClendon sure isn’t. The man is confident, and has the actions and results to show it.

Chesapeake (CHK) and Plains Exploration (PXP) and Production just entered into Haynesville Shale joint venture to drill some 6,875 wells, estimating the Haynesville Shale to hold 23-44 trillion cubic feat of natural gas equivalent after deducting an assumed 25% average royalty burdened. This is just shortly after McClendon commented at the annual meeting that the Haynesville Shale probably holds more natural gas than anyone expects. Probably as much as the U.S. uses in one whole year. Haynesville is starting to look better and better.

If you believe in McClendon like I do, I’d research the Haynesville Shale as much as I can.  This looks like a real money maker…feels like Texas in the old days, or like being in “There Will be Blood“.  I’ve found a great website to keep tabs on the Haynesville Shale and listed it on SuckingLess.com, my new investors resource site.

Chesapeake has a conference call this morning on the joint venture with Plains.  Be sure to listen in. I know I will.

**Disclosure: I own shares of CHK as of this post. **